Art Cashin thinks China might be more important than Greece.
In his morning note to traders on the floor and folks across Wall Street, UBS director of floor operations and the New York Stock Exchange legend Art Cashin writes, “While all eyes are on Greece this morning, perhaps we should also keep an eye on China and Iran.”
Cashin cites the moves from the People’s Bank of China over the weekend to cut interest rates and reduce reserve requirements, a move aimed at slowing a sharp decline in Chinese stocks.
This move temporarily worked as stocks opened higher on Monday in China, but eventually stocks in China gave up the ghost and lost 3.3% on Monday as the Shanghai composite entered a bear market — defined as falling 20% from the most recent highs.
Cashin is also looking out for the looming Iran nuclear negotiations deadline — set for Tuesday — writing that this limit, “looks impractical but there are limits to how far the can can be kicked.”
Of course, the first focus in markets on Monday will be Greece, with Cashin writing that the, “Greek situation brings some moves that seem odd at first glance. Euro pares losses quickly as folks realise the Euro would firm ex Greece and also on a sigh of relief resolution. Yes vote could bring Tsipras resignation but who would commit the political suicide of implementing austerity.”
But again, the biggest financial market move in the last few weeks has been China, and Cashin concludes writing, “I think China may be more important than Greece. Stick with the drill — stay wary, alert and very, very nimble.”